AMC Entertainment, which has surfed a wave of retail excitement over its meme-worthy stocks, has decided to redeem and sell 11.6 million shares.
Exhibitor # 1 announced the plan this morning in an SEC filing. The company’s shares, which rose to over $ 60 per share this week and grossed the once-near bankrupt company, a market value of $ 28 billion, were initially sold today. Almost an hour into the trading day, they were around $ 50, down 20%.
There are now about 3 million retail investors in AMC – about 80% of its shareholders – after investors mobilized on Reddit and other online forums. The company’s stocks followed the unlikely performance of GameStop and other companies, whose stocks moved in inverse proportion to their financials. On Wednesday, regulators stopped trading AMC twice when there was an upward spiral.
In its motion, AMC said it would use the proceeds of the sale for “general corporate purposes, which may include repaying, refinancing, repaying or buying back existing debt, acquiring theater assets, working capital or capital expenditures, and other investments.”
Earlier this week, the company sold 8.5 million shares to investment firm Mudrick Capital, which turned around and sold the $ 230 million position that same day. While the Whipsaw move made many Wall Streeters shake their heads, CEO Adam Aron described the sale of shares as “a very smart way of raising money so we can grow this company.”
The stock drama is set against the backdrop of a revitalized North American box office, with A Quiet Place Part II and Cruella having strong opening weekends on Memorial Day.